by Douglas Gould on June 15, 2010
ASSOCIATED PRESS
A modern day pure salvage case deserves your attention. Many of the elements of a salvage yet to be argued as this case comes to a conclusion. The judge has already ruled that this was a salvage, not a tow. What was the value of the boat both before and after the salvage? What did the captain and crew request from the tug, and what did they do immediately after the collision? What skill and efforts did the tug boat use to assist the ferry? The captain of the ferry will offer some testimony this month and might shed some light on theses questions.
Captain in 2003 S.I. Ferry Crash Is Called to Testify – NYTimes.com.
I guess I have to write a letter to the editor of the NYT and correct this statement:
Citing an ancient maritime law that sailors who assist boats in distress should be rewarded, the tugboat’s owner, the Henry Marine service, and its mate and deckhands at the time of the 2003 crash are seeking a payment based on the ferry’s value.
ALL of our laws are based on ancient laws. Can you say Magna Carta? Somehow, qualifying the salvage law as ancient implies that it is out dated, useless in our modern society. Why don’t they say “Citing an international treaty from 1989 knows as SALCON89, the sailors should be rewarded….” ?
I think that our industry must attack this ridiculous stigma of ancient outdated law that is constantly foisted upon the concept of salvage. Does the American Salvage Association write letters correcting this stuff? How about CPORT?
Salvage laws are not old and outdated, the concepts are still sound public policy and are regularly re-affirmed in the highest courts of the land.
by Douglas Gould on March 25, 2009
Isn’t it ironic that the biggest player in the insurance industry found itself defending the concept of performance bonuses last week in front of a hostile Congress? We’re not talking a few hundred bucks in an envelope at Christmas, either; we’re talking huge, gianormous amounts. Ironic because insurance companies like AIG and Travelers scream to the tops of the highest skyscrapers in NYC when they see a salvage claim of ten or twenty grand for a job that only took a day, or even just a few hours. Outrage is a bitch when it goes the other way, huh guys?
As the anger and shouting about the AIG bonuses calms down, if feels like the entire country is taking a deep breath. Reasonable voices have pointed out that while it is outrageous to reward financiers during a period when their units have lost billions, performance bonuses paid to individuals as a reward for their success remains consistent with our values. Even more on point is the argument that using rewards as an incentive to entice the lucky recipients to find more ways to be successful is not only good for capitalists, but it makes sound public policy too – “We need these people with special skills…”
Has there ever been a better retention bonus contract written than the No Cure/No Pay Open Form? No seriously. The Open Form says “I will work on your behalf during this difficult time. If I do a good job, I expect to be handsomely rewarded.” When insurance companies sign employee contracts like that, it makes perfect sense to them and those contracts are defended all the way to a House Subcommittee. But when the owner of a yacht signs an Open Form, its outrageous! Piracy! Yeah right.
The outrage towards AIG isn’t really about the dollars, we all know corporate executives make a lot of money. The outrage was fueled by the knowledge that these sailors had actually steered the Titanic towards the iceberg. Rather than do something to mitigate the risk, the geniuses at AIG Financial Products receiving bonuses actually caused the problem in the first place. Now we are in the realm of ultra-irony – if there is such a place – because creating a dangerous situation so that you can collect the savior’s reward is the classic definition of piracy.
At least the rewards that modern salvors get under the concept of No Cure-No Pay require some degree of success.
Maybe we just need a new lingo. Boaters have been so conditioned to avoid the term salvage at all costs, and the underwriters just see a skull and crossbones on any page that says salvage. Here is an idea: take all your salvage forms and change the title to Hull Integrity Retention Bonus Contract.
